Ilkeston leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Ilkeston tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Ilkeston you should investigate if your lease has between 70 and ninety years remaining. There are compelling reasons why a Ilkeston leaseholder with a lease having around 80 years left should take steps to make sure that a lease extension is actioned without delay
Leasehold properties in Ilkeston with in excess of 100 years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Irrespective of whether you are a tenant or a freeholder in Ilkeston,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Ilkeston valuers.
Benjamin owned a high value flat in Ilkeston on the market with a lease of just over 59 years unexpired. Benjamin on an informal basis spoke with his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Benjamin to exercise his statutory right. Benjamin obtained expert advice and secured an acceptable resolution informally and sell the property.
Mrs M Hill took over the lease of a one bedroom apartment in Ilkeston in October 2009. The dilemma was if we could shed any light on how much (roughly) premium would be for a ninety year lease extension. Comparative premises in Ilkeston with a long lease were valued around £280,000. The mid-range ground rent payable was £45 collected annually. The lease elapsed in 2095. Given that there were 70 years outstanding we estimated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus legals.
Dr J Wilson took over the lease of a studio apartment in Ilkeston in June 2001. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Comparative properties in Ilkeston with 100 year plus lease were valued around £218,400. The mid-range amount of ground rent was £60 billed every twelve months. The lease ran out in 2084. Considering the 59 years remaining we calculated the compensation to the landlord for the lease extension to be within £27,600 and £31,800 plus expenses.